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    Bloggers Love Costco, Dislike Walmart: Study

    Wholesale and club stores receive the most favorable coverage among retailers in the blogosphere, while traditional department stores and mass merchandisers trail far behind due to substantial criticism from consumers, according to new research from Washington-based media analysis company CARMA International.

    Wholesale and club stores receive the most favorable coverage among retailers in the blogosphere, while traditional department stores and mass merchandisers trail far behind due to substantial criticism from consumers, according to new research from Washington-based media analysis company CARMA International.

    The study identified wholesale giant Costco as the individual retailer receiving the best coverage from bloggers, while mass merchandisers Walmart and Sears and traditional department store Macy's emerged as the retail industry's laggards for the medium. Costco stood out in the blogosphere after it received the most praise for its low prices and quality product offerings.

    "We were surprised at our findings,” said study author and CARMA International VP Christopher Scully. “We thought Walmart's financial coverage in the mainstream media would foster positive attention overall from the blogosphere, but that wasn't the case. Some bloggers criticized the company severely for being anti-worker, driving mom-and-pop stores out of business, and contributing to sprawl and to the decline of the American manufacturing base, and this hurt its overall depiction in blogs."

    The study is based on the findings of CARMA's analysis of consumer-written blog posts about 17 leading wholesale and club stores, traditional department stores and mass merchandisers that appeared during the first two months of 2009. With media monitoring assistance from CyberAlert, Inc. a Web and social media monitoring company, CARMA searched more than 50 million blogs each day for any mention of the selected retailers, finding and examining more than 3,700 blog posts containing relevant discussions about the 17 retailers.

    CARMA analyzed a sample of these posts using research methodology to determine the focus of this blog coverage, the reasons that bloggers praised and criticized the retailers, how often bloggers discussed the current economic environment, and the favorability with which bloggers depicted the retailers.

    Only the wholesale and club store sector received favorable blog coverage overall, with few aspects about wholesalers coming under criticism. Nearly 60 percent of all blog posts on wholesale and club stores were favorable, while only 9 percent of posts were unfavorable.

    In contrast, the blogosphere published unfavorable reporting overall on mass merchandisers and neutral reporting overall on traditional department stores. Both faced significant negative attention from bloggers about their financial struggles in today's economic climate.

    In addition, despite widespread favorable coverage in the mainstream media that Walmart is the only retailer excelling in the current economic turmoil, the world's largest retail chain was one of the industry's worst performers in the blogosphere. In fact, the research revealed that Walmart was the subject of the largest number of negative blog posts across the industry, with many of these posts being highly critical of the retailer, calling Walmart "evil" or other similar invectives. Only Kmart witnessed a larger share of intensely negative coverage than Walmart among retailers that appeared frequently in blog coverage, with 12 percent of blog posts on Walmart depicting the retailer with intense negativity.

    "We didn't anticipate that wholesalers like Costco would fare so well and how much their ability to offer quality products at low prices would factor into their strong performance," added Scully. "Costco really is well positioned to excel in the blogosphere in today's economic climate, as our results suggest it can compete on price at a time when cost is foremost in consumers' minds, without having to worry that people are going to think they are buying lesser-quality goods."

    Citing Walmart's poor performance, Scully said that it may be common for retailers and other companies to see a divergence between how they are covered by consumer-generated media and by mainstream media. "That is why CARMA recommends that companies employ a comprehensive and systematic approach to monitor and measure their consumer-generated media coverage, particularly since blogs and other social media increasingly are affecting public opinion and purchasing decisions," he said.

    However, he cautioned against using automated media analysis tools to identify messages being conveyed in blogs or judge the favorability of consumer-generated content. Instead, Scully suggested a human-based research approach could better assess consumer-generated media.

    "Bloggers often discuss their experiences in unique and interesting ways that make it virtually impossible for computer algorithms or other automated approaches to determine accurately whether a company is being depicted favorably or unfavorably,” he said. “Not to mention that many blogs and online discussions can be rife with sarcasm, snark, slang and pop-culture references. All these factors make it far easier for human analysts to assess consumer-generated media content accurately."

    CARMA included in the study the largest chains from the selected retail sectors as determined by number of stores nationwide, along with several high-end traditional department stores, such as Saks Fifth Avenue and Neiman-Marcus. Other retailers examined for the study included BJ's Wholesale Club, Bloomingdale's, Bon-Ton, Dillard's, JCPenney, Kohl's, Lord and Taylor, Nordstrom, Sam's Club, and Target.

    A detailed analysis of CARMA's research, entitled "U.S. Retailers: Winners and Losers in the Blogosphere," can be found in CARMA's Research Library here.

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